TOKYO (Reuters) – Japan’s core machinery orders fell more than expected in November, data showed on Thursday, underscoring uncertainty about the economic outlook.
Core orders, a highly volatile data series regarded as a leading indicator of capital spending in the coming six to nine months, fell 4.9% in November from the previous month, Cabinet Office data showed.
That compared with a 0.8% contraction expected by economists in a Reuters poll.
On a year-on-year basis, core orders, which excludes volatile numbers from shipping and electric utilities, declined 5.0% versus a forecast for 0.2% growth, the Cabinet Office data showed.
Capital spending is one of the key drivers for Japan’s economy and a major indicator of business confidence.
The government retained its view that machinery orders had “stalled” for 13 straight months, a Cabinet Office official said.
By sector, orders from manufacturers dropped 7.8% in November from the previous month after posting a 0.2% rise in October, with a drop in general-purpose production machinery, the government official said.
Service-sector orders slipped 0.4% after climbing 1.2% in the prior month, owing to declines in orders recorded from the finance and insurance business, the official said.
Business sentiment at big Japanese manufacturers slid in January for the first time in four months and was expected to remain subdued, the Reuters Tankan poll showed on Wednesday, highlighting concerns about weak demand from China and elsewhere.
(Reporting by Satoshi Sugiyama; Editing by Chang-Ran Kim and Sonali Paul)
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